Building a house on your parents' or family land

If your parents have a field to spare, you can build on it, but the land needs to pass to you in a way that suits the taxman, your lender and the planners. Do these in order: check you are likely to get permission, settle the tax, get the site into your name, then confirm the money.

Check planning first

A site you are given still needs permission, and the council decides on the house, not the family tie. Where a county limits one-off houses in the countryside, you will have to show a local housing need. Owning or being given the land helps, but it does not meet the test on its own. Read rural housing policy and local need and talk to a planner before you ask a solicitor to split the land.

Then check the site itself. A farmer’s back field may have a poor road entrance, a high water table or a stream. Sightlines, road frontage and whether the soil can treat wastewater decide the outcome more often than the family connection. A site that fails costs your parents nothing to give and you a great deal to discover later.

Expect an occupancy condition. The permission may require the house to be your home, or your family’s, for a set number of years, often seven. That affects whether you can sell or let it later, so ask what your council’s standard wording is. The planning conditions guide shows how to read it.

The tax on a gift of land

Your side: Capital Acquisitions Tax

A site from your parents is a gift. Capital Acquisitions Tax (CAT) is charged at 33% on what you receive above your tax-free threshold. A child’s threshold from a parent is the Group A threshold. Everything you have received from your parents since 5 December 1991 counts against it, so earlier gifts and an inheritance count.

The Group A threshold was €400,000 before Budget 2027. Revenue has said the increased thresholds apply to gifts and inheritances taken on or after 7 October 2026, so check Revenue’s current figure rather than relying on a number you saw a year ago.

For a site worth, say, €100,000, a child who has had nothing else from the parents would owe no CAT, because the value is well under the threshold. If the same child later inherits the family home, the site counts towards the total. The tax is not due now, but your solicitor should keep a record of the site’s value at the date of the gift.

A gift of land is valued at what it would sell for on the open market, not what your parents paid. Agree the valuation with a local auctioneer or valuer and keep their letter.

Your parents’ side: Capital Gains Tax

Normally a parent who gives away land is treated as having sold it at market value, and pays Capital Gains Tax (CGT) on the gain. Revenue has a relief for exactly this case. Your parent pays no CGT if the land they transfer to you:

• is one acre or less;
• is worth €500,000 or less; and
• is where you will build a house that will be your only or main home.

It also applies to a joint transfer by both parents, and to stepchildren and some foster children. Include the relief in the CGT return for the year of the transfer; it is not automatic.

The relief can be withdrawn from you if you dispose of the land and either did not build a house on it, or did not live in the house as your only or main home for at least three years. That means a plan to build, sell and move on can bring a tax bill to your door. Passing the land to your spouse or civil partner does not trigger it.

An acre is roughly 4,047 square metres. Most single houses with a wastewater system fit comfortably, but check the council’s minimum plot size before you decide how much of the field to give.

Stamp duty

A gift is not free of stamp duty by default. Where land is transferred for less than its market value, stamp duty can be charged on the market value, and the reliefs for family transfers are narrow. Do not assume your transfer qualifies. Your solicitor should state the stamp duty position in writing before the deed is signed.

Getting the site into your name

Your parents’ solicitor and yours, or one solicitor acting with the conflict rules explained to everyone, do these jobs:

1. Define the plot. A land surveyor draws a map of the part being transferred. The Land Registry needs a map it can accept to open a new folio for the plot you are given.
2. Check the title. Is the whole farm in one name or several? Is there a mortgage or a charge on the land? A lender over the parents’ farm must consent to a part being released.
3. Write down access and services. The way in, the water supply, the electricity line and the wastewater pipe may all cross land your parents still own. Rights of way and rights to lay and use services need to be in the deed. A handshake agreement does not bind whoever owns the farm next.
4. Complete the transfer by deed of gift, pay any stamp duty, and register the new folio.

Allow months, not weeks, if the folio needs to be split. Start before you apply for planning, because the application needs a map and proof of ownership or consent.

What the lender will ask for

A self-build mortgage lender wants security over the site. That usually means the site is registered in your name before the first drawdown, free of any other lender’s charge. If your parents will keep the land until the house is up, speak to the lender before you do anything else: some may accept a charge granted by your parents, but you should assume it will need legal work and time.

A gifted site is worth something, and some lenders count it towards the cost of the project. Others look at the amount of money you pay in. Ask in writing how your lender treats a gifted site, and what valuation it needs. The site’s value is also what the funding plan in financing the site should show on the “own funds” line, not a cash figure.

Your lender will want the same planning permission, certification and insurance as for any self-build mortgage. The staged drawdown works as normal once the site is yours.

Insurance on family land

Insurers and lenders want to know who owns the site, who is building and who is liable. Cover is normally arranged for the person who owns the land and the works. If the site is still in your parents’ name when you start, the cover and the lender’s security will not line up, and a claim can be argued about. Transferring the site first avoids the problem.

Your parents may have a farm policy, but it will not usually cover your new house, your contractors or your liability to visitors on a building site. The self-build insurance guide shows what you need.

A checklist before you start

• A planner has said the site and your connection to it are likely to meet the local need policy.
• A site suitability assessment has passed, if there is no mains sewer.
• The site is valued, and the CAT position is written down.
• Your parents’ solicitor has confirmed the CGT relief applies.
• The stamp duty position is in writing.
• A surveyor has mapped the plot, and rights of way and services are written into the deed.
• The lender has confirmed in writing how a gifted site counts.
• The site is in your name, or the lender has agreed another route in writing.
• Cover is arranged for the site and works.

If the family land already has an old house on it, read renovate, extend or rebuild an old house.